• April 9th, 2020

Mortgage business still booming



Maihapa Ndjavera

WINDHOEK – Mortgage lending continued to dominate commercial banks’ credit exposure basket over the year to the end of the third quarter of 2019. This is according to the quarterly economic bulletin for December 2019 that was recently released by the Bank of Namibia. 

The bank stated that the share of mortgage credit in total Private Sector Credit Extension (PSCE) stood at 52.6 percent during the third quarter of 2019, slightly lower compared to 52.7 percent a year ago. 

The increased demand for short-term credit facilities such as overdraft credit, other loans and advances from both businesses and individuals moved these categories into second and third place, respectively. In line with the recessionary economic conditions and shift in lending, other loans and advances stood at 14.4 percent, while overdraft credit posted a share of 12.8 percent during the period under review.

Meanwhile, it reported that instalment credit and share of leasing declined, unlike the share of other advances that remained unchanged for the third quarter of last year.

“Instalment credit edged further down to a share of 10.6 percent during the period under review: from 12.1 percent in 2018, in line with the low number of vehicles sold year-to-date. The share of other advances remained unchanged during the third quarter of 2019, while the share of leasing declined marginally year-on-year.”

In terms of sectoral credit allocation, individuals remained the largest component of commercial banks’ credit exposure at the end of the third quarter of 2019. In line with the annual increase in credit extended to various sectors, the share extended to the individuals’ sector rose to 50.4 percent during the third quarter of 2019 from 48.5 percent a year earlier. 

The report further stated that the share of the commercial and services sector also rose by 0.4 percentage point to 31.2 percent of total loans and advances. Weak domestic economic growth had caused shares of several sectors to decline in the quarter under review. 

“The shares for the mining and quarrying, agriculture, building and construction sectors declined in line with the decreasing international spot prices of commodities, coupled with the prevailing drought and weak domestic economic growth. Meanwhile, the share of fishing and manufacturing increased slightly as corporations in these industries made more use of bank credit during the third quarter of 2019.”
 


Staff Reporter
2020-01-10 07:51:05 | 2 months ago

1 Comments

  1. User
    David Jeong-seok

    Do you need a loan? Apply now: ryeodavividjeong@gmail.com

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